The Old Guard Takes on Trust Issues
Its not just e-marketplaces and startup service providers that are taking business-to-business e-commerce trust seriously. Century-old insurers, banks and business services companies also have stepped to the fore to help e-businesses mitigate the risks of buying and selling on the Web.
Their names are familiar: Insurer American International Group Inc., financial services company Bank of America Corp., business information provider The Dun & Bradstreet Corp., and verification and testing provider SGS Société Générale de Surveillance SA, among others, have recently launched e-trust service offerings.
Since last year, through a series of new products and joint ventures, the companies have added services to secure online B2B transactions, insure against risk in online trade, verify the readiness of suppliers and learn details of a potential trading partners background.
"We think the issue of trust is the glue that is going to make online commerce meet the potential everyone thinks it will meet," said Gretchen Hayes, president of AIGs E-Business Risk Solutions division, in New York.
AIG formed a joint venture with Dun & Bradstreet in October called Avantrust. It provides a suite of trust-related services used mainly by public and private e-marketplaces.
AIG, for example, offers insurance that protects exchanges against problems related to nonfulfillment of orders or Web site crashes. Dun & Bradstreet, of Murray Hill, N.J., provides information that can be used for identity checks on online trading partners. Together, the companies apply Dun & Bradstreets business and credit information with AIGs proprietary algorithms to help sellers make credit decisions and receive credit insurance, Hayes said.
To address questions concerning the reliability of suppliers, SGS launched a division and service in the fourth quarter of last year called SGSonsite. SGS first online offering is a service that allows B2B suppliers to essentially receive a seal of approval after SGS assesses such criteria as production capacity, online trading capabilities, quality assurance and control systems, and even environmental stewardship. Suppliers that pass receive SGS-issued seals that they can post on their B2B sites, through SGSonsite or with participating e-marketplaces, said Hal Loevy, vice president of global strategy and development at SGSonsite, in Geneva.
Next up for SGSonsite is to Web-enable other traditional services of the 123-year-old company so that customers could, for instance, order custom inspection reports on a supplier through SGSonsites Web site or a partner e-marketplace and even receive the reports online, Loevy said. SGSonsite plans to begin rolling out additional services in May.
Financial institutions havent been left out in the rush to provide B2B trust services. A group of eight founded Identrus LLC in April 1999 to formulate standards for digital certificates based on public-key infrastructure technology. The financial institution members, which now total 41, can offer digital certificate services to corporate customers and e-marketplaces by using Identrus as the validation authority, said Laura Rime, director of global marketing at Identrus, in New York.